NAP Investor Presentation October 2012

Transcripts - NAP Investor Presentation October 2012

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Investor PRESENTATION• PRESENTATION October 2012

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Forward LookingSTATEMENTSCertain information included in this presentation constitutes „forward-looking statements‟ within the meaning of the „safeharbor‟ provisions of the United States Private Securities Litigation Reform Act of 1995 and Canadian securities laws. Thewords „expect‟, „believe‟, „will‟, „intend‟, „estimate‟, „forecast‟, and similar expressions identify forward-looking statements.Such statements include, without limitation, any information as to our future exploration, financial or operatingperformance, including: the Companys forward looking production guidance, projected capital expenditures, operatingcost estimates, project timelines, mining and milling rates, the methods by which ore will be extracted, projected grades,mill recoveries, and other statements that express managements expectations or estimates of future performance.Forward-looking statements are necessarily based upon a number of factors and assumptions that, while consideredreasonable by management, are inherently subject to significant business, economic and competitive uncertainties andcontingencies. The factors and assumptions contained in this press release, which may prove to be incorrect, include, butare not limited to: metal prices assumptions, Canadian and U.S. dollar exchange rate assumptions, that there will be nosignificant disruptions affecting operations, that prices for key mining and construction supplies, including labour andtransportation costs, will remain consistent with the Companys expectations, that the Companys current estimates ofmineral reserves and resources are accurate, and that there are no material delays in the timing of ongoing developmentprojects. The forward-looking statements are not guarantees of future performance. The Company cautions the readerthat such forward-looking statements involve known and unknown risks that may cause the actual results to be materiallydifferent from those expressed or implied by the forward-looking statements. Such risks include, but are not limited to: thepossibility that metal prices, foreign exchange rates or operating costs may differ from managements expectations,uncertainty of mineral reserves and resources, inherent risks associated with mining and processing, the risk that the Lac desIles and Vezza mines may not perform as planned and that the Offset Zone and other properties may not be successfullydeveloped, and uncertainty of the ability of the Company to obtain financing. For more details on the factors, assumptionsand risks see the Companys most recent Form 40-F/Annual Information Form on file with the U.S. Securities and ExchangeCommission and Canadian provincial securities regulatory authorities. The Company disclaims any obligation to update orrevise any forward-looking statements, whether as a result of new information, events or otherwise, except as expresslyrequired by law. Readers are cautioned not to put undue reliance on these forward-looking statements.All dollar amounts are in Canadian currency unless otherwise stated, all references to production refer to payableproduction, and all reference to tonnes refer to metric tonnes.U.S. investors are encouraged to refer to the “Cautionary Note to U.S. Investors Concerning Estimates of Measured,Indicated and Inferred Resources” in the appendix. 1

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Use of Palladium inCATALYTIC CONVERTERSGasoline Engines Hybrids & Other New Forms• Use +90% palladium (of total required • Neutral impact on PGM use PGM content) • Gasoline hybrids tend to use as much palladium as normal gasoline enginesDiesel Engines • Currently account for only 1% of global cars sales1• Historically used platinum due to technical requirements • Forecasted to be 14% of overall market by 20202• Currently use 30% palladium, with scope to increase to 50% due to advent of low sulphur diesel fuel Electric • No requirement for catalytic converters • Challenged by lack of infrastructure to recharge, high costs, long charging periods and short driving range • Forecasted to account for only 2% of global car sales by 20202 1. CPM Group, June 2010 2. Stefan Bratzel, director of the Centre of Automotive Management in Germany; as reported in Mitsui Global Precious Metals “Pole Position” Report, June 2010 11

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LDI Mine & Mill ComplexA WORLD CLASS ASSET• Located north of Thunder Bay, Ontario, Canada• One of only two primary palladium producers in the world• Deposit is unique in the world: high palladium concentration, broadly disseminated mineralization vs. narrow vein• Total production of +2.6 M oz of palladium since 1993• Currently undergoing a major expansion to increase production and reduce cash costs per ounce• 15,000 tpd mill has excess capacity available for production growth• Significant exploration upside identified on the LDI property• Notable safety award received for lowest reportable injury rates 15 15

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ShareholderINFORMATIONNorth American Palladium‟s vision is to become a low cost, mid-tier precious metals company operating inmining friendly jurisdictions. NAP is an established precious metals producer that has been operating its flagshipLac des Iles mine (LDI) located in Ontario, Canada since 1993. LDI is one of only two primary producers ofpalladium in the world, and is currently undergoing a major expansion to increase production and reduce cashcosts per ounce. NAP also operates the Vezza gold mine located in the Abitibi region of Quebec. NAP‟sexperienced management and technical teams have a significant commitment to exploration and arededicated to building shareholder value. Corporate Office: Royal Bank Plaza, South Tower 200 Bay St., Suite 2350 Toronto, ON M5J 2J2 Security Symbols: NYSE MKT– PAL TSX – PDL, PDL.DB Website: www.nap.com Investor Relations: Camilla Bartosiewicz Director, Investor Relations & Corporate Communications camilla@nap.com 416-360-7374 25

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Appendices &FURTHER INFORMATION 26

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SeniorMANAGEMENT Andre Douchane – Chairman and Interim CEO Mr. Douchane is a seasoned mining executive with over 40 years of experience in the mining industry with a solid track record of successfully bringing development projects into production. He was appointed to the Company‟s Board of Directors in April 2003, and served as the President and CEO until January 2006. Mr. Douchane is currently the Chief Executive Officer of THEMAC Resources Group Ltd., a Vancouver- based resource company focused on exploring and developing natural resource properties. Previously, he held senior positions with several precious and base metal international mining companies including President and CEO of Starfield Resources Inc., President and COO of Chief Consolidated Mining Co., and Vice President, Operations of Franco and Euro-Nevada (Newmont Mining Corporation). He holds a Bachelor‟s degree in Mining Engineering from the New Mexico Institute of Mining and Technology and is a graduate of the Executive Business Program at the Kellogg School of Business in Toronto. Greg Struble – VP and COO Mr. Struble is a mine engineer with over 30 years of experience in underground mining. Prior to joining NAP, he served as Executive Vice President and Chief Operating Officer of Stillwater Mining Company, where he was responsible for two underground palladium mines as well as smelter and refinery operations. Prior to this, he worked as underground project manager for Barrick Gold‟s Cortez Hills Joint Venture. Mr. Struble has also worked internationally at a number of large gold mines, including General Manager of the El Penon Mine in Chile and the Jerritt Canyon Mines in Nevada. Previously, he worked for the Homestake Mining Company and held various positions including Mine Superintendent at their Homestake Mine in South Dakota. Jeff Swinoga – VP, Finance and CFO Mr. Swinoga has over eighteen years of experience in the resource, mining and finance industries. He brings a wealth of experience in leading debt and equity transactions, including project financings for mine development. He has served as Senior Vice President, Finance & CFO of MagIndustries Corp., Vice President, Finance & CFO of HudBay Minerals Inc., and was Director, Treasury Finance of Barrick Gold Corporation for seven years. Mr. Swinoga is a Chartered Accountant and also holds a Master of Business Administration degree from the University of Toronto and a Honours Economics degree from the University of Western Ontario. Mr. Swinoga has overall responsibility for the company‟s financial activities. David C. Peck – Head of Exploration Dr. Peck is a Professional Geoscientist with nearly 30 years of exploration and research experience specializing in magmatic Ni-Cu-PGE ore deposits. Dr. Peck holds global recognition as an expert in PGE exploration after serving as a senior technical and strategic consultant to several public and private companies and having worked on exploration and mining projects in more than a dozen countries. He was directly involved in several significant magmatic Ni-Cu-PGE discoveries in Canada and overseas. Prior to joining NAP, Dr. Peck served as President and Senior Technical and Strategic Consultant at Revelation Geoscience Ltd., and prior to this, he served as Global Nickel Commodity Leader at Anglo American plc, a Senior Geologist for Falconbridge Ltd., a Senior Mineral Deposits Geologist with the Manitoba Geological Survey, held various academic roles in Canadian universities, and was the technical lead on a multi-year mineral potential study funded by the Ontario Geological Survey. He has authored numerous public presentations and government and academic publications addressing his area of specialization. 27

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Cautionary Note to U.S. Investors ConcerningMINERAL RESERVES AND MINERAL RESOURCE• Mineral reserves and mineral resources have been calculated in accordance with National Instrument 43-101 as required by Canadian securities regulatory authorities. For United States reporting purposes, Industry Guide 7, (under the Securities and Exchange Act of 1934), as interpreted by Staff of the Securities Exchange Commission (SEC), applies different standards in order to classify mineralization as a reserve. In addition, while the terms “measured”, “indicated” and “inferred” mineral resources are required pursuant to National Instrument 43-101, the U.S. Securities and Exchange Commission does not recognize such terms. Canadian standards differ significantly from the requirements of the SEC, and mineral resource information contained herein is not comparable to similar information regarding mineral reserves disclosed in accordance with the requirements of the U.S. Securities and Exchange Commission. U.S. investors should understand that “inferred” mineral resources have a great amount of uncertainty as to their existence and great uncertainty as to their economic and legal feasibility. In addition, U.S. investors are cautioned not to assume that any part or all of NAPs mineral resources constitute or will be converted into reserves. For a more detailed description of the key assumptions, parameters and methods used in calculating NAP‟s mineral reserves and mineral resources, see NAP‟s most recent Annual Information Form/Form 40-F on file with Canadian provincial securities regulatory authorities and the SEC.• Please refer to North American Palladium‟s most current Annual Information Form and applicable technical reports available on www.sedar.com, www.sec.gov and www.nap.com for further information. 28

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LDI Reserves & Resources NOTES1. Prepared in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects (NI 43-101) and the Canadian Institute of Mining, Metallurgy and Petroleum classification system. U.S. investors should refer to the Annual Information Form for an overview on how Canadian standards differ significantly from U.S. requirements.2. Palladium ounces are stated as contained ounces. Disclosure of contained ounces is permitted under Canadian regulations; however, the SEC generally permits resources to be reported only as in place tonnage and grade.3. Mineral Resources for the Offset Zone were estimated from drilling completed to March 31, 2012 by Todd McCracken, P.Geo., of Tetra Tech, an independent Qualified Person within the meaning of NI 43-101. The mineral resource calculation uses a minimum 3.5 g/t Pd resource block cut-off. The mineral resource estimate is based on the combination of geological modeling, geostatistics and conventional block modeling (5 m x 5 m x 5 m blocks). Assay grade capping was determined not to be necessary. The Offset Zone resource models used the ordinary kriging (OK) grade interpolation method within a three-dimensional block model with mineralized zones defined by wireframed solids. The QA/QC protocols and corresponding sample preparation and shipment procedures for the Offset Zone have been reviewed by Tetra Tech. Resources were estimated to the 4070 Mine Level (-930 m elevation), a maximum depth of 1,430 m. The following metal price assumptions were used: US$475/oz palladium, US$1,500/oz platinum, US$1,200/oz gold, US$9.00/lb nickel, and US$3.25/lb copper. A US$/Cdn$ exchange rate of US$0.95 = CDN$1.00 was also applied.4. The mineral reserve and resource estimate for the Roby Zone, open pit and stockpiles were estimated as of June 30, 2010 by Scott Wilson RPA and updated by David Penna, P.Geo., an employee of the Company and a Qualified Person under 43-101 to reflect: (i) additions to mineral reserves in the Roby Zone as a result of a lower cut-off palladium grade; (ii) depletion from production up to March 31, 2012, and (iii) mineral reserves from the crown pillar (supported by an internal engineering report). The following cut-off grades were used: (i) 1.8 g/t PdEq for the Roby open pit, within an optimized pit shell run below the current pit survey; (ii) 1.9 g/t PdEq for the mine stockpiles; and (iii) 5.8 g/t PdEq for the underground Roby Zone. These cut-off grades were determined under the assumption that production would take place at a rate of 14,000 tpd. Metal price assumptions of US$350/oz palladium, US$1,400/oz platinum, US$850/oz gold, US$6.50/lb nickel, and US$2.00/lb copper were used in the estimation of cut-off grade. A US$/Cdn$ exchange rate of 1.11 was also applied.5. Mineral resources which are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues. The quantity and grade of reported inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred resources as an Indicated or Measured mineral resource and it is uncertain if further exploration will result in upgrading them to an Indicated or Measured mineral resource category.6. Numbers may not add due to rounding. 30